Affordable housing sets tune for B'luru's homebuyers

Bengaluru witnessed 34,880 new launches during the year, almost double of 18,290 housing units rolled out in the city during 2018

Representative image
Highlights: 
The push in the real estate supply came from the affordable housing as sub-Rs 80 lakh homes constituted 80% of supply of new homes
The existing unsold inventory of the houses in Bengaluru had come down by a whopping 24%
Despite such a steep rise in the demand, the property prices in the city remained flat

The rise in affordable housing is giving a much-needed fillip to the Bengaluru's housing markets, that saw a whopping 91% increase in the supply during 2018 along with far higher demand.

The city witnessed 34,880 new launches during the year, almost double of 18,290 housing units rolled out in the city during 2018, data available with real estate advisory Anarock reveals.

The push in the real estate supply came from the affordable housing as sub-Rs 80 lakh homes constituted 80% of supply of new homes in Bengaluru. The sub Rs 80 lakh homes accounted for 28,250 of the new houses supplied in Bengaluru market.

The year witnessed realty major Embassy, which was focusing on luxury segment till now, foray into the affordable segment. Many other realtors in the city have also added the push towards affordable housing.

Despite the record number of new homes rolled out in the city, the existing unsold inventory of the houses in Bengaluru had come down by a whopping 24% on back of the higher demand.

At the end of the calendar year 2018 there were 73,337 unsold homes in the city, as against 96,000 exactly a year ago.

According to the analysts at Anarock, an uptick in the traction of ready-to-move-in and nearing-completion properties helped developers clear their existing stock.

In fact, the demand for the new homes in the city was far higher than the supply in the market. The city saw 57,540 new homes being sold in 2018, 65% more than supply in the city. The city saw the sales of new homes jump by 33% from 43,130 sales in 2017 -- highest jump across the country.

The number could have been far higher if the Goods and Services Tax (GST) had not played the spoilsport. "GST on under-construction properties was a major hurdle in 2018, dissuading buyers from purchasing properties that fell under its gambit. The twin issues of stalled/delayed projects and financial stress within residential real estate augmented interest for ready-to-move-in properties with most buyers preferring to buy what they can see," Anarock said in the report.

Hoever, despite such a steep rise in the demand, the property prices in the city remained flat. The average housing cost in Bengaluru stood at Rs 4,925 per sq feet, up marginal 2% from Rs 4,810 per sq feet in 2017.

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Affordable housing sets tune for B'luru's homebuyers

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